Theories of Economic Development

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Introduction
The existence of a chronic state of “underdevelopment” is not only a question of economics or the simple quantitative measures of income, employment and gini-coefficient.Underdevelopment is a real fact of life for two billion people of the world- a state of mind as far as a state of national poverty. Gaulet (1971) poignantly describes under development as a shocking; the squalor, disease, unnecessary deaths and hopelessness of it all. The condition of underdevelopment in its totality is thus a consciously experienced state of deprivation which is rendered especially intolerable as more and more people acquire information about economic progress in developed economies and realize that the technical and institutional means of abolishing poverty, misery and disease indeed exist. This therefore calls for a critical examination of the various approaches that are used for the study of development in the developing economies and their relevance and applicability in analyzing the current obstacles to achieving development in these economies. Approaches to the study of development

I. The Linear stages Approach
Development in the 1950s and 1960s was viewed as a series of successive stages of economic growth through which all countries must pass. Following the second world war, interest in the poor nations of the world began to materialize, economist in the industrialized nations were caught off guard, since they had no readily available tools with which to analyze the process of economic growth in largely agrarian societies characterized by the virtual absence of modern economic structures. Out of this somewhat sterile intellectual environment, fueled by the cold war politics of 1950s and 1960s and the resulting competition for the allegiance of newly independent nations came the Stages of growth model of development. The most influential and outspoken advocate being an American economic historian Walt. W. Rostow. According to Rostow, transition from underdevelopment to development can be described in terms of series of steps through which all countries must proceed. It is primarily an economic progression in which the right quantity and mixture of savings, investment and foreign aid were all that was necessary to enable developing nations to proceed along an economic growth path. He states that it is possible to identify all societies, in their economic dimension, as lying within one of five categories; The Traditional Society –An economy in this stage has a limited production function which barely attains the minimum level of potential output. This does not entirely mean that the economy's production level is static. The output level can still be increased, as there was often a surplus of uncultivated land which can be used for increasing agricultural production. States and individuals utilize irrigation systems in many instances, but most farming is still purely for subsistence. There have been technological innovations, but only on ad hoc basis.The stage characterized by agrarian method of characterized by subsistence agriculture or hunting & gathering; almost wholly a "primary" sector economy, limited technology; The Pre-conditions for take-off into self-sustaining growth is characterized by secular education, capital mobilization, and development of banks. According to Rostow economic growth of the economy undergoes a process of change for building up of conditions for growth and take off, these changes in society and the economy had to be of fundamental nature in the socio-political structure and production techniques. The Take-off stage is where the society is driven by economic processes other than traditions. This stage is characterized by dynamic economic growth. As Rostow suggests, all is premised on a sharp stimulus (or multiple stimuli) that are of economic, political and technological change. The main feature of this stage is rapid, self-sustained growth. Take-off occurs when sector led growth...
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